States mull cutting Medicaid, other programs to stop spiraling deficits

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Gov. David Paterson (D-NY)
Gov. David Paterson (D-NY)
As the economic crisis continues, the long-term care community is bracing for states to slash Medicaid as one way to reduce steep budget shortfalls this coming year. New York could be one such state.

Gov. David Paterson (D-NY) has proposed $5.2 billion in Medicaid and education funding cuts, The New York Times says. Meanwhile, other governors are proposing cuts to other services and spending. Michigan is planning to salt fewer roads this winter, California is seeking a higher sales tax, Oregon wants to lift the gas tax, and Ohio may need a federal loan to cover unemployment costs.

A recent report has found that state Medicaid programs were under-funded by $4.2 billion this year (McKnight's, 10/23). Many healthcare groups and lawmakers have called for a stimulus package to be passed that includes a temporary increase to the Federal Medical Assistance Percentage, which proponents argue will help states cover budget shortfalls, boost the economy and protect care and services for the elderly.